I received a suggestion the other day to post a bit about restoring credit after prison. I left prison June 12, 2020. I was able to obtain work and a bank account in 45 days. I went to my credit union to request a credit card in November of that same year, unsecured with a $500.00 credit limit. I never used the card for anything that I couldn’t pay for by the end of the week. Small things like gas, groceries, clothes. By doing so I was never at risk or over extending, and it helped build my score.
In December 2020 I went to buy a car. I walked out with a 2019 Nissan with under 30,000 miles. The catch was my loan was at 24% interest. But always remember: YOU ARE NOT MARRIED TO THE CAR, YOU ARE JUST DATING IT! After six months of on time payments I went to refinance in June of 2021 and I traded in the Nissan for a 2019 Tucson, my interest dropped to 10.9%.
By refinancing, my credit rose because I had paid off the old loan with the new loan, thus I had now a years history of on time payments, and a paid off loan!
I began to receive offers for credit cards shortly after and chose two. I use them in the same manner I used the first. If you can’t pay it off in full in a week, don’t use it.
After Christmas, but before New Years when ALL financial institution’s are trying to make their last quotas, and you stand a better chance at getting a better deal, I went in to refinance my car again. I was able to get my interest down to 3.99%, $2,000.00 cash back, no payments until April of this year.
All of this within 1 1/2 years of getting out of prison. You can do this too. Trust me, car payments at first will be high… but make them on time and you can refinance in six months, and so on, and so on.
If anyone has any questions, please ask. It is hard to restablish credit after prison. The bonus is that after 7-10 years you have no debts or credit score (Civil judgements do not come up on credit checks anymore), and you can build credit fast if you are responsible and willing to take the high payments for six months on a vehicle. Buying a vehicle is the best way to build your credit.